The grace period is over. Honestly, if you're still treating the Financial Conduct Authority’s (FCA) flagship regulation as a compliance tick-box exercise, you’re playing a dangerous game. The latest fca consumer duty news isn't just about administrative updates; it's about a regulator that is starting to flex its muscles. We are moving from the "implementation phase" into the "enforcement phase," and the shift is jarring for firms that thought they could coast.
The Reality Check on Fair Value
For a long time, firms focused on the easy stuff. They updated their terms and conditions. They sent out a few emails. But the FCA's recent multi-firm reviews—especially the one focusing on the CFD sector published in late 2025 and the ongoing scrutiny of smaller mutuals in early 2026—reveal a massive gap in how "fair value" is actually calculated.
It’s not just about being cheap.
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The FCA is calling out firms for "double dipping"—charging fees for services that are already covered by other costs. They’re looking at overnight funding charges in trading apps and the transparency of interest rate tiering in bank accounts. Basically, if your fee structure is so complex that a reasonably smart person can't explain it to their grandmother, you're probably failing the Consumer Duty.
What the FCA found in the CFD Market
In their review of 23 firms, just over half were rated as "satisfactory." That sounds okay until you realize nearly 50% required "significant work." The failures weren't small. We’re talking about:
- Board reports that just repeated the rules back to the FCA instead of proving the firm followed them.
- Grouping vastly different products into a single "fair value assessment" to save time.
- Ignoring "hidden" costs like overnight funding when arguing that a product is good value.
The 2026 Roadmap: What’s Actually Changing?
If you think you've seen the last of the rulebook changes, think again. The FCA is currently in the middle of a massive "streamlining" project. This sounds like deregulation, but it’s actually a tightening of focus. They want to get rid of 100+ pieces of outdated guidance to make the Consumer Duty the "one ring to rule them all."
Expect a big consultation in H1 2026. The goal? Clarifying how the Duty applies through distribution chains. This has been a massive headache for wholesale firms who don't even talk to retail customers but are still caught in the net. The FCA is finally looking at removing non-UK customers from the scope of the Duty, which would be a huge relief for global firms.
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But there’s a catch.
While they might relax the rules for non-UK business, they are doubling down on "vulnerability." In Q1 2026, the FCA and the Information Commissioner's Office (ICO) are expected to drop new guidance on how firms should share data about vulnerable customers without breaking GDPR. It's a tightrope walk. You've got to protect their privacy, but you also have to know enough about them to ensure they aren't being exploited by a product they don't understand.
The Closed Book Crisis
The July 2024 deadline for closed products—those no longer sold but still held by customers—felt like a lifetime ago. Yet, fca consumer duty news suggests many legacy systems are still failing the test. The FCA is seeing a "neglect" of these older products.
Think about those old "zombie" pension funds or life insurance policies from the 90s. Many of these have higher fees than modern equivalents. Under the Duty, you can't just leave them there to rot. You have to actively assess if they still offer fair value. If they don't, you might have to move those customers to better products or lower the fees.
The regulator isn't interested in "we've always done it this way" as an excuse. They’re specifically looking at whether firms are using "friction" to stop people from leaving these high-cost legacy products. If your cancellation process involves a 40-minute phone queue and a physical letter, but your signup process took two clicks, you are in the crosshairs.
The "Lead Firm" Concept in Insurance
In a move that’s been cheered by the insurance industry, the FCA is looking to designate a "lead firm" in co-manufacturing arrangements. This is huge. Previously, if three firms worked together on a policy, all three were tripping over each other to do the same compliance checks. By the end of 2026, we expect a new framework where one firm takes the hit, and the others can focus on actually running the business.
Actionable Insights for 2026
Stop waiting for a "final" version of the rules. The Consumer Duty is designed to be an evolving standard, not a static law. To stay ahead of the curve:
1. Audit your MI (Management Information)
If your Board is looking at "Red/Amber/Green" (RAG) reports that are always green, you’re probably measuring the wrong things. The FCA wants to see evidence of bad outcomes that you caught and fixed. No news is bad news in their eyes.
2. Test your communications
Don't just ask your legal team if a letter is compliant. Ask a focus group of actual customers if they understand it. The FCA is doing their own "mystery shopping" on customer journeys, focusing on how easy it is to switch or complain.
3. Review your "Professional Client" opt-ups
The FCA is consulting on a new "high-asset threshold" test. This would give firms a "brighter line" to identify sophisticated investors who don't need retail-level protections. This could significantly reduce your compliance burden if you manage high-net-worth individuals.
4. Prepare for the "Gateway"
For those in the crypto space, the "cryptoasset gateway" opens in September 2026. If you want to be regulated, you’ll need to prove you meet Consumer Duty standards from day one. There is no "bedding-in" period for new entrants.
The underlying message is simple: The FCA is tired of firms asking for more "clarity" as a way to delay making hard decisions. They’ve provided the framework. Now, they want to see the results. If your firm can't prove—with data—that your customers are better off today than they were three years ago, then the next bit of fca consumer duty news you read might be an enforcement notice with your name on it.
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Move beyond the paperwork. Start looking at the actual human impact of your fees, your fine print, and your customer service hold times. That’s where the real regulatory risk lives now.